CCP Working Paper 09-11
43 Pages Posted: 28 Nov 2009 Last revised: 7 Jan 2010
Date Written: November 26, 2009
This article proposes an empirical method for finding the determinants of the size of remedy offers relative to the level required by the European Commission in individual cases. Evidence is presented that merger characteristics, such as the size of the transaction, or the number of horizontal overlaps do not affect the probability of a remedy offer being successful. It is also shown that pre-merger expectations about merger-generated efficiencies increase the likelihood of successful offers. These findings are very important features of EC merger control, and a novelty in the existing literature. If parties are delay-averse, then the complexity of the case matters very little, as merging parties appear to be able to offer something outright acceptable for the Commission. This may lead to a counter-productive situation where less delay-averse mergers become more prone to offering too much, which can result in over-fixing the competition problem for those mergers where savings would be more likely.
Keywords: European Commission, mergers, merger remedies, saving expectations, efficiency defence, litigation, bargaining
JEL Classification: K21, K41, L49
Suggested Citation: Suggested Citation
Ormosi, Peter L., Determinants of the Success of Remedy Offers: Evidence from European Community Mergers (November 26, 2009). CCP Working Paper 09-11. Available at SSRN: https://ssrn.com/abstract=1513942 or http://dx.doi.org/10.2139/ssrn.1513942